The Next Healthcare.gov Fiasco? | Commentary

Will the federal government create another healthcare.gov fiasco in the selection of the next Local Number Portability Administrator? Or has it learned that complex, critical IT projects require very careful deliberation and strong technical leadership over many years? The current evidence says “no” and reminds me of the words of a song from my youth: “When will they ever learn?”

In 1996, Congress mandated local number portability — the ability to take your telephone number to a new service provider — to encourage competition and expand consumer choices. Neustar won the contract to establish and operate the number portability system in 1997. Initially, the FCC had divided the contract into regions, some of which were awarded to Neustar and some to Perot Systems. When Perot Systems failed to deliver a stable platform on time, Neustar established a nationwide service. Today, Neustar manages more than 500 million telephone numbers and processes more than 1.2 million transactions each day.

The current LNPA contract expires in 2015. When the process of awarding the next LNPA contract began in 2010, the Federal Communications Commission and the industry developed a five-year timeline to select a successor LNPA and, if necessary, transition to a new provider. The original schedule included more than two years for a transition, once a new contract was signed on or around October 2012.

The selection process is now more than a year behind schedule and at a high risk of another major failure, akin to healthcare.gov. What’s more, the LNPA selection process fails to address five key elements. The omission of any one of these elements could lead to failure; but the fact that all five have not been addressed makes that outcome all too likely. (In fact, an analysis by the Standish Group states that the probability of failure is 96 percent, even higher than they ranked the risk of failure for healthcare.gov.)

The five missing elements are:

1. Inadequate selection criteria. Procurements require detailed criteria that evaluate and assign weight to the experience, expertise, financial capabilities, customer service capabilities, testing capabilities, and future R&D commitments of the potential vendors. A rigorous selection process will require vendors to demonstrate that they can deliver a solution of the scope and scale needed. Here, the selection committee provided an inadequate indication of what it takes to satisfy the needs of all constituents and sustain at least the level of service being provided today.

2. No demonstration of a working system. Vendors of complex IT systems must demonstrate — not just claim on paper — that they can provide the right capabilities on the required schedule. The industry committee advising the FCC on the LNPA selection intends to base its recommendation on a series of yes/no questions about various requirements. Relying on a paper process here would be like buying a jet plane — sight unseen — just because a biplane maker says it can build an airliner.